Magazine article The CPA Journal

Monitoring Quality in the Local Tax Practice: A Voluntary Program from the AICPA

Magazine article The CPA Journal

Monitoring Quality in the Local Tax Practice: A Voluntary Program from the AICPA

Article excerpt

The AICPA Tax Division has developed a Voluntary Tax Practice Review Program (VTPR) for use by local CPA firms. Conceptually, it is very similar to the AICPA peer review and quality review programs of accounting and auditing practices, but with one notable difference. At this time, the program is strictly voluntary. There are no reports, and none of the workpapers generated in the review are retained.

The AICPA Federal Tax Executive Committee felt that many very large firms and associations of firms have benefitted from programs monitoring the quality of tax practices. The committee wanted to make such a program available to the local practitioner.

The program is presented in a manual now available from the AICPA, "Guidelines for Voluntary Tax Practice Review." The manual is designed to provide materials for a reviewer to conduct a quality review of a tax practice and consists of the following:

1. Statement on Guidelines for Tax Practice Quality Control (Guidelines). The statement is intended to provide the framework for quality control in a tax practice and is the counterpart to the Statement on Quality Control 1, "System of Quality Control for a CPA Firm," which sets the standards for quality control for accounting and auditing practices.

The Guidelines identify nine elements considered to be essential for a properly functioning system of tax practice quality control.

1. Advocacy and integrity;

2. Assigning personnel to engagements;

3. Consultation;

4. Supervision;

5. Hiring;

6. Professional development;

7. Advancement;

8. Acceptance and continuance of clients; and

9. Inspection.

The one significant difference between these elements and those for an accounting and auditing practice is the first one. Advocacy and integrity is substituted for independence, which is not an element of quality control in a tax practice. …

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